Energy customers to get refunds

MORE than a million households are to be refunded £10.4 million after the energy watchdog found 18 gas and electricity suppliers overcharged customers when they switched to better deals.

Ofgem said suppliers including the Big Six firms such as British Gas, Swindon-based npower and EDF overcharged customers £7.2 million over seven years after failing to follow price protection rules.

The rules are designed to safeguard a customer’s tariff price when they decide to either switch suppliers or deals after a price increase. It said several suppliers self-reported the issue to the regulator, which then prompted it to ask all firms to assess their practices, revealing failures among 18 suppliers between 2013 and 2020.

The firms have agreed to refund all those affected and, in some cases, make additional good will payments to the tune of £10.4 million in total, Ofgem said.

Anna Rossington, interim director of retail at Ofgem, said: “Customers should have confidence in switching and not be overcharged when doing so.

“This case sends a strong message to all suppliers that Ofgem will intervene where customers are overcharged and ensure that no supplier benefits from noncompliance.”

Customers affected include those on standard variable and fixed term deals who switched to different suppliers, as well as those on fixed term deals who switched to another deal with the same supplier. Ofgem said it was not taking formal action against the suppliers, given their co-operation and agreement to compensate.